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Supply and Demand In Action: Inflight Wi-Fi Prices Jump

Business Travel, Industry, Wi-Fi TrendsThursday, August 27, 2015

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By Patti Thompson

Michael Small, the chief executive of Gogo, said new satellite technology should add capacity and eventually let the company lower prices for in-flight Wi-Fi. Credit David Kasnic for The New York Times

Wednesday’s New York Times includes an article on how Gogo has, over the past few years, drastically changed their Inflight Wi-Fi pricing structure to accommodate the increased demand placed on their network. This increase isn’t apparent when looking at their average cost per session, because of the extreme lack of demand found in many routes, but it is real all the same.

The good news is, according to Gogo CEO Michael Small, their newly approved satellite technology should help the Inflight Wi-Fi company actually lower prices.

The real question is — is this the thin end of the wedge and will prices just keep climbing until the public rebels, or will the new technology onto which Gogo has been pinning their future expansion hopes actually lead to lower priced inflight Wi-Fi?

Either way, the bottom line is the inflight Wi-Fi industry is apparently subject to the same supply and demand economics as any other commercial venture.